What Distinguishes An Independent Contractor From An Employee?

On Behalf of | Aug 2, 2021 | Wage-And-Hour Claims

Not everyone that works for an individual or a company is an employee. Some are independent contractors. Since these workers do not enjoy the same kinds of benefits as regular employees, you should know if your employer is classifying you as an independent contractor when you know you are an employee.

If your workplace misclassifies your employment status, you could lose out on important benefits. The Florida Department of Management Services provides some information that may help you to understand the differences between employers and independent contractors.

The nature of your relationship

An independent contractor tends to perform a temporary job or a few jobs over a period of time. Once the job is over, the contractor may move on to a different employer. An employee by contrast has a relationship that continues indefinitely. If you are an employee, you may have also signed a contract that guarantees benefits like a pension or vacation pay.

The control over your job

Think about how much control your employer has over your work. Does your employer provide your tools or equipment, or do you take care of that yourself? Does your employer put you on a regular time schedule that requires you to clock in and out, or do you have control over when you work? Additionally, does your employer dictate how you do your job, or do you have control over how you work?

Independent contractors exert greater control over their work. If your employer imposes requirements on when, where and how you work, you are likely an employee.

The control over your finances

Consider how much control the employer has over your financial situation. If you have to pay for certain expenses out of pocket and submit quarterly tax payments, you are an independent contractor. But if your employer withholds a portion of your taxes for Social Security and compensates you for your travels and other expenses, you are an employee.

Be aware of your rights

Employers have the duty to classify their workers properly. If your workplace tries to designate you as an independent contractor to avoid paying certain wages and benefits, the state government and the IRS could hold your employer responsible.